What is Guaranteed Asset Protection Insurance (GAP)?

GAP provides you added protection if you have asked for a loan to purchase your vehicle. It is designed to pay out your unpaid loan balance if your car is stolen or totally damaged.  Gap eases the financial burden the loss of your vehicle can create. It protects old and new cars against almost all risks that cause total loss. The insurance covers the difference between the car’s value before the accident and the outstanding loan. In some cases it also covers the insurance deductible.
You can find similar products that pay the comparable cost of replacing the car, or provide you with an initial deposit to buy a new one. Some GAPs also pay the difference of the car’s original market price and its cost before the accident, even if you did not take out a loan.